Gary Gensler is a former investment banker, lecturer at Massachusetts Institute of Technology (MIT) Sloan school of management, former government official, and currently the Chairperson of the United States Security and Exchange Commission (SEC). He was interview at the Aspen Security Forum where he made a very crucial statement, “though there was a lot of hype masquerading as reality in crypto field Satoshi Nakamoto’s innovation is real.”
Gary Gensler said, “It has been and could continue to be a catalyst for change in the fields of finance and money.”
Satoshi Nakamoto is the famous pseudonymous person who founded Bitcoin and the hidden technology behind cryptocurrency and blockchain. The SEC Chair, Gary Gensler was found to make statements intending to acknowledge the great innovation and its potential for development.
The SEC, the federal reserve, US Treasury, and many other people in this space have been waiting for regulations from the key organizations and administration for regulations in cryptocurrency. the US has already swiftly enforced sanctions through the corresponding banking system.
A bill has been drafted which puts constraints on the community of cryptocurrency enthusiasts. Gary Gensler also emphasized the pressing need for tighter regulations in the space of cryptocurrency and sought to the senators for major authority here.
Why must the regulator chief, who specified to work towards the crackdown of the cryptocurrency industry speak such glorious words? Let us see.
Satoshi Nakamoto’s Innovation is Real
In the Aspen Security Forum, the SEC Chair — Gary Gensler outlines his ambitions for the organization to play a crucial role in formulating policies to regulate the volatile cryptocurrency market. He initiated by referring to the first-ever cryptocurrency found — Bitcoin. He speaks about Satoshi Nakamoto, and how the cryptocurrency is not all that ambiguous [as the US lawmaker portrayed it.]
“His [Satoshi Nakamoto’s] innovation spurred the development of crypto-assets and the underlying blockchain technology,” said Gary Gensler. He later added, “the crypto asset class has ballooned”. The current “total market value of all cryptocurrencies now stands at $2.48 trillion” as per data from Bloomberg.
When Gary Gensler worked as a professor at MIT, he researched and wrote a paper on cryptocurrency where he noted about Satoshi Nakamoto, cryptocurrency, blockchain technology &c. In the conversation at the Aspen Security forum he referred to his research and opined, “In that work, I came to believe that, though there was a lot of hype masquerading as reality in the crypto field, Nakamoto’s innovation is real. Further, it has been and could continue to be a catalyst for change in the fields of finance and money.”
In 2008, in the middle of the financial crisis, an eight-page paper was released on a “cipher punk mailing list” by an author name ‘Satoshi Nakamoto’.
Satoshi Nakamoto then wrote, “I am working on a new electronic cash system that’s fully peer-to-peer with no trusted third party.”
The SEC chair says, “At its core, Nakamoto was trying to create a private form of money with no central intermediary, such as a central bank or commercial banks.” however, Gary Gensler can deny that, “No single crypto asset, though, broadly fulfills all the functions of money. Bitcoin has some of it but not all…”
He explains how the cryptocurrency market grew over a decade. Its market cap is huge, “more than any traditional jurisdiction”, said Gary. He emphasizes how the market is “high speculative stores of value”.
He further said, “We also haven’t seen crypto used much as a medium of exchange. To the extent that it is used as such, it’s often to skirt our laws concerning anti-money laundering, sanctions, and tax collection, on the dark web. It also can enable extortion via ransomware, as we recently saw with Colonial Pipeline.”
Gensler clarified that he is “technology-neutral”. He feels that cryptocurrency has the potential catalyst for real change, and further added, “but I am anything but public policy neutral.”
“As new technologies come along, we need to be sure we’re achieving our core public policy goals. In finance, that’s about protecting investors and consumers, guarding against the illicit activity, and ensuring financial stability,” said Gary Gensler.
He further goes on to say that cryptocurrency and stablecoins sold as security are not that ambiguous. “There’s a lot of clarity on that front … Certain rules related to crypto-assets are well-settled. The test to determine whether a crypto asset is a security is clear.”
Ripple CEO Brad Garlinghouse disagrees and states, “In my judgment, if you’re dealing with an alcoholic that doesn’t want to admit they have an alcohol problem, to say that we have certainty, we have clarity, is like the alcoholic saying ‘I don’t have a problem’. This is the elephant in the room.”